WHITSUNDAY E-NEWS REAL ESTATE: 3rd week of May

Published on: May 26, 2021

Hi, Annette Neil from PRD Whitsunday with this week's e-news.

This week I thought I'd talk about a real hot topic here in north Queensland, and that is the cost of insurance.

We're in the tropics, and it's not a surprise that insurance costs a little bit more up here; however, it has gotten quite out of control in recent years, particularly around strata complexes.

Unit complexes that we have quite a few of here have pushed strata fees up because of insurance costs.

What does that do to the market for units? It keeps prices low because it makes demand lower, meaning prices are staying a little bit suppressed hence why the prices of units haven't jumped up as much as houses have...

In another news, the government has announced the 10 billion reinsurance fund. How that's going to work? It is not quite clear yet.

They have said they're going to consult with the insurance industry to come up with a solution that works for all.

The government is going to be underwriting $500,000 insurance policies for North Queensland.

This guarantees that when a natural disaster happens, they're going to have those funds set aside to assist when it's called upon.

We'll have to wait and see what happens here and what effect it will have on strata and units, but essentially, if it brings the cost of insurance down, it brings body corporate fees down.

That means that we should start to see prices improve a little bit and maybe a higher volume of sales so until next week